State oil frm PETROAMAZONAS EP outlines how its energy effciency strategy can reduce overall CO2 emissions by 800,000 tons per year

Attending conferences and exposing innovative ideas about Energy Effciency in the • Where possible use exhaust gas of the power upstream Oil Industry is all the rage these days. generation facilities as energy source for process heat. But it is important to point out that these initiatives are often limited to polishing up the • Develop an integrated power distribution/ “perception” of the industry and not necessarily a starting point towards dramatically transmission system by means of which the changing the “substance” or the way the industry does business. various oil felds (indifferent to the operators) can be interconnected thereby allowing for a dispatch No third party or norm exists for ranking/validating energy effciency efforts/achievements based on economical merits (prioritizing lowest in this industry which means that “whatever you say goes”. cost/emission power). • By means of the power distribution/transmission If you add the following arguments to the ones listed earlier it becomes clear that it is often system the various oil felds can share installed very diffcult to get funds and traction to implement Energy Effciency in the Oil Industry: capacity, “stand-by” capacity and spinning reserve. By interconnecting this distribution/ • Oil companies do NOT perceive Energy Effciency as detrimental to their survival. It is transmission system to the national grid the NOT a “cut throat” environment like the airline industry. system can import or export power, thereby • Oil Company value and/or executive bonuses are mainly a factor of oil reserves, oil eliminating the risk of stranded assets in the future production volumes and prices; energy effciency indicators are NOT a driving force, (post petroleum era). nor are there any price differentiations linked to these indicators. • By means of power generated with Associated • Allocating (limited) funds to energy effciency projects is an uphill challenge given the Gas and Hydropower imported from the national high return (relative short term) prospects of oil reserve/oil production projects (core grid eliminate the use of diesel, and reduce the business of the oil companies). use of crude oil as fuel for power generation • For Energy Effciency projects to be successful, objectives, conviction and passion by means of which the net equivalent crude have to trickle down from top management to operators in the feld (seldom are oil production is expected to increase by incentives tied to Energy Effciency KPIs). approximately 25,000 barrels per day. • The OGE&EE Project has been designed Given this business environment it is remarkable that an oil producing country like Ecuador (engineering) and is being developed decided to dramatically revolutionize the course previously dictated by highly rated (procurement, construction and commissioning) international oil companies giving the green light to develop what has been referred to as by a 100% Ecuadorian multiple task force the OGE&EE Project (“Optimización de Generación Eléctrica & Efciencia Energética”). whereby, at its peak, there will be over 3,000 people working directly on the Project. This is This consists of the following pillars: quite an achievement considering that in the past • Reduce overall CO2 emissions by 800,000 tons per year. these large infrastructure projects were normally • Optimize Associated Gas as raw material for LPG production and/or as fuel for power being developed by international engineering/ generation. construction companies. 66 www.rtcc.org